Remortgage of an encumbered property - please help

happy.bunny_5

Hi,

I'd be grateful if anyone could give me advice please.:)

My husband and I are a second marriage.

We each owned a property. I have sold my property and have the proceeds from that.

My husband has been trying to sell his property for 5 years now, but with no luck.

We would love to buy a new joint property together soon.

Could my husband remortgage his house; he owns it outright. The problem is that he has retired and so has no income; so what he would like to do is to remortgage and then rent it out.

We could then use the rent to pay the mortgage. It would then give us a lump sum to purchase a joint property together.

Is this a crazy idea or can it be done?

Thanks in anticipation.

handytips

Your husband would be able to raise money via a Buy to let mortgage, however the amount he is able to borrow will be determined by the amount of rent you will recieve, you would be able to raise upto 80% of the value of the property assuming the rental cover warrants it. rule of thumb work out the borrowing available at 125% of the payrate at an interest rate of 5.99%. Should you want to raise less money then the arrangement fees are likely to be lower, however beware many of the BTL products attract high fees typically between 2 and 3.55 of the borrowing, your husband being retired will not be a problem as some lenders will go to the age of 90. The buy to let products are available via any good whole of market advisor and i advise you to contact one.

handytips

should read between 2 and 3.5% of the borrowing, sorry.

CLAPTON

5 years?

what's wrong with it other than the price?

happy.bunny_5

Thank you so much for this. This is a great help.

We have both been out of the mortgage market for a long time now. Things are very different these days and neither of us have any experience of BTL mortgages.

What is the best way to find a good whole of market advisor?

Conrad

I'd say ask around locally. Want you do not want is one of those larger call centre type brokers - the equivolent of asking Homebase staff for building advice!

Take care to find a buy to let lender that does not require earned income.

All the best and enjoy the new home!

getmore4less

whats wrong with his house that you can't live in it?

Annisele

I'd worry that if you can't sell the place in five years, then you might also struggle to rent it out.

Have you had any offers at all in that time? Is it just price, or is the property very unusual in some way?